Branson win puts lottery bosses in dock

Future management of the National Lottery was thrown into doubt last night after a High Court jury decided that an attempt was made to bribe Richard Branson by a rival bidding to win the lottery contract. Andrew Buncombe reports.

At the end of a three-week libel case at the High Court in London, Guy Snowden, head of the American company GTech, immediately resigned as a director of Camelot and it was announced that there would be a full investigation into the bribery attempt and the damaging fallout. Many at Westminster believe that here should be a fundamental overhaul of the way the lottery is run.

Mr Snowden, whose company provides all the computer equipment for Camelot, which runs the National Lottery, was in effect found guilty of trying to bribe Mr Branson to get him to drop his bid to run a no-profit lottery during a lunch in September 1993.

Mr Branson, 47, said after the hearing that the public's faith in the lottery would only be restored if a full investigation into the matter was carried out. He also called on Peter Davis, head of the lottery watchdog, Oflot, to consider his position and said that it would be "incredible" if he did not resign. "We came to the High Court to ask a jury to adjudicate," said the clearly delighted Virgin boss.

Camelot, of which GTech is a major shareholder, tried last night to distance itself from the affair and said it was not affected by the result. But a document, details of which have been made known to The Independent, reveal that senior Camelot officials were aware of rumours of Mr Snowden's alleged bribe attempt as early as November 1993. The document, an electronic message from David Wrigg, Camelot's PR director, to the company's chief executive, Tim Holley, talks of the need to discuss the "GTech bribe attempt". The e-mail exchange happened two years before Mr Branson made details of the bribe attempt public on a BBC Panorama programme.

As the fallout from the case threatened to spread, the Secretary of State for Culture, Media and Sport, Chris Smith, said he would personally be monitoring the situation. "It is right that Guy Snowden should resign immediately in the light of the jury's verdict," he said.

Sources close to the minister said that he was deeply concerned about what had happened and he was demanding that Oflot carry out a full inquiry. Mr Branson said later in a statement: "I believe the faith of the British public can only be fully restored by the appointment of a new director- general of Oflot, with immediate effect, as a first step to restoring the credibility of the lottery and, in the meantime, Peter Davis should consider his position very carefully."

In a typically ebullient gesture, he said he would donate his damages of pounds 100,000 to "those smaller charities who had lost out as a result of the lottery". Costs of the trial, estimated to be more than pounds 2m, will be paid by GTech.

Mr Davis, who was called as a witness and said he could not remember Mr Branson ever mentioning an alleged bribe to him, said last night that he had written to Camelot demanding action, including the "termination"of Mr Snowden's involvement in the lottery.

"I have been in contact with the chairman of Camelot Group plc to specify the areas in which I consider action necessary, and to say that I expect action to be put in hand within 24 hours," he said.

He said he would not be demanding that Mr Snowden resign as chairman of GTech Corporation, or that GTech divest itself of its 22.5 per cent shareholding in Camelot. He said there was nothing to suggest that Camelot would not continue its role of lottery operator. He denied his own position was at risk. "My veracity was not questioned in the court, I'm going to continue to do the job that's given to me by the Lottery Act."

Mr Branson had sued Mr Snowden and GTech after the latter dismissed as false the entrepreneur's claim that the American had tried to bribe him. Mr Snowden had countersued over the original allegation, made in December 1995.

Mr Snowden, 52, said that he was extremely disappointed by the result and was considering an appeal. He said that he had resigned from Camelot and GTech UK but he could see no reason why GTech should not continue to be part of Camelot, of which it holds 22.5 per cent.

Bribe bombshell, page 5

Leading article, page 20